Feb 9 The Arrogance of Nintendo

Since the release of the original NES, Nintendo has always been a little arrogant when it comes time to release a new console. They don't care what the status of the industry is, how many people want a new console, or how many developers and publishers want a new console, Nintendo historically has released a new console only when they are good and ready. And why not? The company has been very profitable and has been a leader in the industry for a number of years. But they have been on a downhill slide for a few years now and have seen two new leaders slowly push them out of the console race.

It all started back during the Nintendo Entertainment System days. Nintendo was enjoying much success with the NES and developers all over the world sought to release their titles on the console instead of the competing Sega Master System platform. This made Nintendo the dominant player in the industry and they called all of the shots. This did not last forever though. With the release of the Sega Genesis, Sega had a console that not only was far superior to the NES, but caused Nintendo to delay the release of the Super Nintendo Entertainment System (SNES) so they could redesign it and make it more powerful. They were not prepared for what Sega had and they paid for it.

Nintendo spent the majority of the 16 bit wars playing catch-up to Sega and while they were ultimately successful in defeating Sega, largely due to support from developers like Square, Nintendo had relinquished some of their power. By not being prepared for their competition and having a successor as powerful as or more powerful than Sega, Nintendo paid the price. However, they did not learn from this mistake.

While Nintendo was ultimately successful in defeating both the Sega Master System and Turbo Express handheld platforms with their Game Boy, Nintendo did not have a perfect record. In a surprising move, they released a new handheld platform called the Virtual Boy that had a strange combination of Red and Black graphics. However, this system was not very portable and required the user to set a large set of goggles on a table and look into them to play the games. This system caused eye problems and Nintendo quickly abandoned the platform. Instead of releasing a version of the Game Boy that had both color and a backlight, Nintendo failed with the Virtual Boy showing that they were not ready to give consumers what they wanted to play. But their next mistake proved to be the most costly in the history of the company.

Nintendo claimed that there was no need for 32 bit because it just wasn't powerful enough and the SNES could provide gamers all they need. While Nintendo tried to sell this lie to the public, Sony and Sega had their PlayStation and Saturn systems on the market and 32 bit slowly caught on. While it wasn't immediately popular, the turning point for these two consoles was when Nintendo ran off their biggest exclusive developer, Square. Square had been responsible for the best Role Playing Games in the industry. And since Nintendo refused to listen to Square, and other developers, by using cartridges instead of CD's for their next console, the developers began to come over to the 32 bit consoles. Nintendo not only lost Square, they handed them over to Sony in one of the biggest moves in video game history. Square went on to develop Final Fantasy VII--which brought new life to RPGs worldwide. For the first time ever, the genre was a big seller outside of Japan!

But Nintendo wasn't going to try and get Square back. They continued on with their Nintendo 64 platform and it did not reach the success they had hoped for. The industry moved on to Sony and Sega and Nintendo was left out in the cold with their expensive cartridges. Still, this did not stop the arrogance of Nintendo from showing up. In an issue of Nintendo Power after the release of Mario 64, the official Nintendo magazine run by Nintendo, they explained that CD-ROM based systems, like the Saturn and PlayStation, were not able to run 3D games like Mario 64 because that was only possible on cartridges and not CD's. Of course, I believed them at the time. But when I realized they were lying, my days as a Nintendo fanboy were over.

After the failure of the Nintendo 64 and a complete lack of third party support, I was sure Nintendo was ready to put their ego to bed and get serious about becoming a major player in the industry again. It certainly appeared that way with the release of the Nintendo GameCube. Finally Nintendo was going away from Cartridges and moving to CD's. But wait, their games aren't just normal CD's, they are a special smaller sized disk and Nintendo still charged developers almost as much to make games on the console as they did with the Nintendo 64. Despite this, it appeared that The Big N was back. But then things took a turn for the worse at E3 2003.

At their pre-E3 2003 press conference, Nintendo announced that they would not follow the same path as other companies in the industry and they would run their company the way they wanted to. They admitted that they would not cater to the Third Parties--that they were just fine and profitable without them. If that meant they were less successful or popular, then so be it. I was shocked as I heard these words and so were my colleagues. Had Nintendo not learned anything? Were they content to be a distant third place and no longer a leader in the industry? After two successful E3 shows, Nintendo stunk up the show in 2003 and I still have not forgotten the arrogance they showed during their pre-E3 2003 press conference.

Nintendo has done a few things right. After E3, in 2003, they lowered the price of the GameCube to $99. However, while this was a great move, they also announced a new handheld that would be based on the same technology of the GBA, have two screens, and use a different format for the games. No word on if it will be backwards compatible or not. But instead of releasing a serious contender for the upcoming Sony handheld, the PSP or PlayStation Portable, Nintendo showed their arrogance by announcing a very underpowered system that nobody in the industry is excited about or will have any idea how to develop for it. In the meantime, Sony readies developers for the PSP and prepares to dethrone Nintendo as the Portable Gaming King.

However, the most disturbing news in the history of Nintendo happened today. Word is coming out of Japan that Nintendo is content with the GameCube and they do not feel it is necessary for a new console to be released anytime in the near future. So while Microsoft readies their "Xbox Next" for a rumored 2005 release and Sony plans to release the PS3 probably in 2006, Nintendo feels they can wait until 2007 to release the successor to the GameCube. The biggest problem with releasing a console late is that the one who comes out second and third ends up getting the smallest number of users. Sony did so well with the PlayStation 2 mainly because there was not another decent console with support out. Because Microsoft and Nintendo released their consoles so much later after the release of the PS2, it doesn't matter how much more powerful they are, Sony has the user base and therefore--developers will continue to make games on their system first.

So why not release a new Nintendo console at the same time as their competitors? Nintendo says that the system has not yet reached its full potential and they don't expect it to reach this potential until around 2007. They went on to say that owners are satisfied with the performance of the GameCube. Nintendo of America denies these rumors coming out of Japan and says that the quotes from Japan were taken out of context and based on speculation. While it is good to see NOA making such claims, they did not announce a release date for a new Nintendo console or deny that the story was completely false.

Instead, Nintendo of America says that they are concentrating only on gameplay and that they will be releasing a whole bunch of new accessories for the GameCube in 2005 and 2006--when the new consoles from Microsoft and Sony are supposed to be released. These accessories include new items for the Game Boy Advance and the recently announced Nintendo DS.

Will the arrogance of Nintendo continue? Can Nintendo do what consumers want and release a new console around the same time as their competitors and work to get third parties making more exclusive games for their platform? Can they release a new console that can compete with the power of the PSP? There are a lot of questions to be answered but we will have to wait and see how Nintendo chooses to answer them. I hope that they realize the errors they have been making and once again return to their throne as the King of Gaming.

Update from Nintendo:

Nintendo has contacted CVGames and let us know that contrary to what has been reported in one Japanese publication, Nintendo is staying in the console hardware business and still plans to launch our next home console in the same timeframe as our competitors. In addition, they are working on a number of complementary technical advances that they believe may significantly enhance the gaming experience. They also continue to look for exciting ways to extend the value of the Nintendo GameCube, and will share those ideas with us in the coming months.

Specific details about other accessories or systems and their functionalities haven't yet been made public. However, they will make further information about our next console available in the near future, and we look forward to further demonstrating our record of breakthrough innovation in video game play.

While Nintendo of America's PR team tries to put a positive spin on these rumors, history does show that Nintendo has been very arrogant and continues to do things their way. Furthermore, they have shown that they will even go as far as doing business "their way" even if it costs them support from Third Parties, the game players, and the gaming industry as a whole. We will keep you updated on further developments and we can only hope Nintendo can shed this image they have.

By Kaleb Rutherford - 02/10/04

Screenshots for The Arrogance of Nintendo

Kaleb is the Editor & Publisher of CVGames and the host of the Parents Press Play Podcast. As a husband and homeschooling father to four boys, Kaleb provides a unique perspective on the gaming industry alongside other areas of entertainment and technology that have been enhanced by his 20+ years of covering these fields.

When not podcasting at Parents Press Play or covering the industry at CVGames, Kaleb loves to bowl, cook, spend time with his family, and cheer on the San Francisco 49ers and Texas Rangers. However, the truth is that he can never get enough time sharing his love of video games and other areas of entertainment and technology that he covers through his website and podcast!

Kaleb is the Editor & Publisher of CVGames and the host of the Parents Press Play Podcast. As a husband and homeschooling father to four boys, Kaleb provides a unique perspective on the gaming industry alongside other areas of entertainment and technology that have been enhanced by his 20+ years of covering these fields.

When not podcasting at Parents Press Play or covering the industry at CVGames, Kaleb loves to bowl, cook, spend time with his family, and cheer on the San Francisco 49ers and Texas Rangers. However, the truth is that he can never get enough time sharing his love of video games and other areas of entertainment and technology that he covers through his website and podcast!